Delhi District Court
Shri Sandeep Tomar vs Shri Ashok Kumar on 15 September, 2016
IN THE COURT OF ANOOP KUMAR MENDIRATTA,
JUDGE, MACT-1 (CENTRAL), DELHI.
Suit No. 260/12
Unique Case ID No.02401C-031762012
1. Shri Sandeep Tomar
S/o Late Shri Satyabir Singh Tomar (Son)
2. Shri Sumit Tomar
S/o Late Shri Satyabir Singh Tomar (Son)
Both R/o
C-3/146, Janak Puri, New Delhi-110 058
.........PETITIONERS
Versus
1. Shri Ashok Kumar,
S/o Shri Dhani Ram,
R/o Village Kamal Pur,
PS Murthal, Sonepat, Haryana ........(Driver)
2. Shri Harish Kumar,
S/o Late Shri Chaman Lal,
C-18, Shivaji Park, Delhi,
Also At:
5-A/42, NIT, Faridabad, Haryana ........(Owner)
3. The Oriental Insurance Company Ltd.
1/28, Sunlight Building,
Asaf Ali Road, New Delhi-110 002 ........(Insurer)
............. RESPONDENTS
Date of filing of Claim Petition : 06.05.2005
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
Arguments heard on : 05.09.2016
Judgment pronounced on : 15.09.2016
JUDGMENT
1. An award dated 30.09.2009 was passed in favour of the petitioners in the present proceedings by ld. Predecessor which was challenged by the petitioners as well as by the insurance company before the Hon'ble High Court. The case was remanded back vide order dated 25.05.2012 passed in MACA No.631/09 and MACA No.27/10 with the following directions:
i. To elicit evidence with regard to the income of partnership firm of M/s Tomar Construction Company after the death of the deceased and ii. To elicit evidence with regard to the disability of the partnership firm in not having the requisite experience in obtaining the contracts.
iii. Independent decision for quantum."
The order passed by the Hon'ble High Court was further challenged by the petitioners before the Hon'ble Apex Court but remained unsuccessful and, hence, the matter is again pending consideration before the Tribunal in terms of order dated 25.05.2012 passed in MACA No.631/09 and MACA No.27/10.
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
2. In brief, claim petition has been preferred under Section 166 and 140 of Motor Vehicles Act, 1988 (hereinafter referred to as 'the Act') by the petitioners, who are sons/LRs of the deceased claiming compensation for a sum of Rs.50,00,00,000/- (Rupees Fifty Crore Only) in respect of accidental death of their father Sh. Satyabir Singh Tomar in a motor vehicular accident on 30.12.2004.
Brief facts of the case giving rise to the claim petition are that on 30.12.2004 petitioner No.1 Sandeep Tomar was travelling along with his father Satyabir Singh Tomar, Smt.Rita Tomar (mother), Shivani Tomar (sister) and Smt. Kabuli Devi (Grandmother) towards Shamli from Mujaffar Nagar, UP in Toyota Qualis No. DL 4CP 4024 driven by Ombeer Singh Tomar. At about 9.00PM at Panipat Khatima Road near canal within jurisdiction of PS: Titavi, Mujaffar Nagar, UP, Toyota Qualis was hit by a tanker No. HR-38-G- 7310 coming from opposite direction which was driven by Respondent No.1 in a rash and negligent manner. Consequent to the injuries sustained in the accident, four occupants in the Toyota Qualis, namely, Smt. Rita Tomar, Shivani Tomar, Smt. Kabuli Devi and Shri Ombeer Tomar expired at the spot while Shri Satyabir Singh Tomar succumbed to injuries in the hospital. Petitioner No.1 Sandeep Tomar also suffered grievous injuries and was removed to hospital by his cousin Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Parminder Tomar @ Pardeep who was also on his way to Shamli in another vehicle following the Totoya Qualis in which the victims were travelling. Driver of the offending vehicle fled from the spot. FIR No.179/2004 u/s 279/338/427/304A IPC dated 30.12.2004 P.S. Titavi, Mujaffar Nagar, U.P. was registered regarding the accident.
It is further the case of the petitioners that Shri Satyabir Singh Tomar was running contractorship business in the name of M/s Tomar Construction Company (a sole Proprietorship concern) and had several worthy long earning projects in his hand at the time of accident. The Government projects were undertaken on tender basis in the name of his proprietorship firm. Due to the death of the deceased Satyabir Singh Tomar as per terms and conditions of those contracts, most were liable to be cancelled. The petitioners tried to take care of some of the work left by the deceased but they could not work upto the strength and quality of deceased due to lack of foresight and experience. Further, the new contracts which were planned also had to be cancelled.
It is further the case of petitioners that the proprietorship firm M/s Tomar Construction Company stood wound up after the death of the proprietor Shri Satyabir Singh Tomar. Further the petitioners started a new partnership firm in the name & style of Tomar Construction Company which is a new and separate legal entity without the requisite experience and turnover and could not participate in the new tenders floated Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. by any government agency for lack of requisite minimum experience/turnover. As per the case of petitioners it was an altogether new beginning though the petitioners were taking care of some of the projects left by the deceased in order to escape the liability of loosing the security deposits.
It is further the case of petitioners that several difficulties were faced even for the continuation of some of the existing projects undertaken for want of completion of requisite legal formalities due to death of deceased though the work was to be completed in a time bound frame and the payments were to be made regularly.
It is also the case of petitioners that prior to the accident, petitioner no.1 Sandeep Tomar aged about 21 years at the time of accident after passing of Degree of Bachelor Information System and diploma of Business from Swinburne University of Technology, Victoria, Australia was working at Australia but due to the untimely death was forced to leave his lucrative job. Further petitioner no.1 was only surviving member to look after his younger brother Sumit Tomar (petitioner no.2 aged about 18 years) who was still a student and the leftover business.
3. In the written statement filed on behalf of Respondent No.1 & 2, it was submitted that initially the cover note bearing no.0420815 was issued for the period 22.03.2003 to 21.03.2004 in respect of vehicle no. HR-38G-7310 and Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
insurance policy was issued vide Policy No.360400/31/02/6313587 by National Insurance Company Ltd. mentioning therein cover note no.0420815. Thereafter, vehicle was got insured with Oriental Insurance Company by Respondent No.2 for the period 22.03.2004 to 21.03.2005 and on the basis of previous policy and cover note, Oriental Insurance Company Ltd. issued policy bearing no.2004/2200 mentioning therein the previous policy no.0420815 year 2003. However, in the policy the vehicle number was mentioned as HR-3PG-7310 instead of HR-38G-7310. On inquiry, Respondent No.2 was informed that the policy shall be read as per previous policy cover note no.042815. Therefore, it was claimed that vehicle bearing no. HR-38G-7310 was insured with Respondent No.3. It was further submitted that driver of the offending vehicle was working with Respondent No.2 for the last two years and holding a valid and effective driving licence. The accident was stated to have taken place due to rash and negligent driving by the driver of the Toyota Qualis as the said vehicle was driven at a high speed on wrong side. The compensation claimed by the petitioners was stated to be exorbitant. It was further claimed that Respondent No.1 had been falsely implicated.
4. In the written statement filed on behalf of Respondent No.3/insurance company, legal offer for settlement was made subject to production of certain documents Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. and willingness of the petitioners/claimants. It was further submitted that the registration number of the tanker alleged to have been involved in the accident in question was shown to be HR-38-G-7310 whereas the insurance policy reflected the number of the vehicle as HR-3PG-7310. As such, it was submitted that the insurance company was not in a position to admit that tanker bearing registration no. HR-38G-7310 was insured at the time of accident. It was further stated that the insurance company shall not be liable to pay the compensation, if the driver of the offending vehicle was not holding a valid and effective driving licence or the licence to drive the particular type/class of vehicle at the time of accident. It was further claimed that the accident had occurred due to rash and negligent driving by the driver of Toyota Qualis in which victims were travelling and as such the claim petition seeking compensation was stated to be misconceived and not maintainable. It was also submitted that the case is of contributory negligence and the liability, if any, ought to be apportioned between the owners of the two vehicles involved in the accident proportionately. The amount claimed by the petitioners was further stated to be exorbitant and exaggerated and it was submitted that the petitioners had not impleaded all the legal heirs of deceased Satyabir Singh Tomar.
The averments made by the petitioners regarding the carrying of business by the deceased and financial loss on account of death of Satyabir Singh Tomar were further denied. It Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. was submitted that the petitioners were major and financially not dependent upon the deceased. It was further stated that the petitioners had also filed other petitions for compensation in respect of death of other family members and each one of the said family member had been shown to be earning members. Further the petitioner no.1 was also an earning member and as such there was no question of being financially dependent upon their father. It was submitted that the business allegedly carried by the father of the deceased would continue to be carried by the sons/petitioners and for this reason no financial loss could be said to be occasioned by the petitioners.
5. It may be noticed that out of the six petitions, three claim petitions bearing nos. 132/05, 133/05 and 135/05 are admitted to have been settled in Lok Adalat.
Vide common award dated 30.09.2009 passed by the ld. Predecessor the remaining three claim petitions bearing Suit No.654/08 in respect of death of Ms.Shivani Tomar @ Jyoti (sister of the petitioners), Suit No.655/08 in respect of death of Smt.Rita Tomar (mother of petitioners) and Suit No.656/08 in respect of death of Sh.Satyabir Singh Tomar were decided.
Vide MAC APP. No.53/10Sandeep Tomar & Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Another vs. Oriental Insurance Company Ltd. & MAC APP No.28/10Sandeep Tomar & Another vs. Oriental Insurance Company Ltd., the appeals in respect of compensation claim of deceased Smt. Rita Tomar and Shivani Tomar stand disposed of.
6. On the pleadings of the parties, following issues were framed for consideration vide order dated 13.01.2006 by ld. Predecessor:-
(i) Whether the deceased Kabuli Devi, Satyabir Singh Tomar, Ombeer Singh Tomar, Ms. Shivani Tomar @ Ruby and Smt. Rita Tomar received fatal injuries due to the rash and negligent driving of Truck Tanker HR-38-G-7310 by respondent no.1?
(ii) Whether the petitioners are entitled to any compensation? If so, what amount and against whom?
(iii) Relief.
7. Eight witnesses were examined prior to remand back of the case. Further additional evidence of PW6 Shri Sandeep Tomar was also recorded before the Hon'ble High Court u/o 41 Rule 27 CPC. After remand of the case further evidence of PW6 Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Shri Sandeep Tomar has been led on record in the present proceedings and also three witnesses PW9, PW10 & PW11 have been examined on behalf of the petitioners.
The eleven witnesses examined on behalf of the petitioners are namely PW1Kusum Tomar (wife of deceased Ombeer Tomar), PW2 Pradeep Kumar (Office Assistant M/s Tomar Construction Company), PW3 Ravinder Kumar (Proprietor M/s R.K. Constructions with which deceased Shivani Tomar was employed), PW4 Parvinder Kumar (eyewitness), PW5 Rakesh Gupta, PW6 Sandeep Tomar (petitioner no.1, PW7 Meenakshi Bhardwaj (from Record Room JSCC, Tis Hazari Courts), PW8 Ramesh Gupta (Senior Assistant Income Tax Department Circle 38 (1) Central Revenue Building), PW9 Daya Nidhi (Senior Judicial Assistant, Record Room Delhi High Court), PW10 Kailash Chand Bairwa, Tax Assistant/Record Clerk, office of the Assistant Commissioner of Income Tax Circle 62(1) New Delhi) and PW11 Shri Virendra Kumar (Executive Engineer, CPWD).
So far as witnesses PW1 Kusum Tomar, PW2 Pradeep Kumar and PW3 Ravinder Kumar are concerned, their evidence is relevant to the cases pertaining to the claim petitions in respect of Ombeer Tomar and Shivani Tomar which Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. have already been disposed of, as contended by the counsels.
For the purpose of present proceedings, only the evidence of five witnesses recorded prior to remand of the case is relevant namely, PW4 Parvinder Kumar (eyewitness to the accident), PW5 Rakesh Gupta (employee of the Chartered Accountant), PW6 Sandeep Tomar (petitioner no.1), PW7 Meenakshi Bhardwaj (from Record Room JSCC, Tis Hazari Courts) and PW8 Ramesh Gupta (Senior Assistant Income Tax Department Circle 38 (1) Central Revenue Building) apart from the statements of PW9, PW10 & PW11 recorded after remand of the case.
Accordingly for the purpose of disposal of the present claim petition, the statement of relevant witnesses is briefly referred to hereinafter.
8. PW4 Parvinder Kumar testified that the accident occurred on 30.12.2004 at about 9PM and he had witnessed the accident while he was proceeding from Mujaffar Nagar to Qasim Pur Kheri. The accident occurred about 300 metres ahead of Toll Tax booth near Mujaffar NagarShyamali Road as truck No. HR38G7310 coming from the opposite side driven in a reckless manner came on the wrong side of the road and hit Toyota Qualis No.DL4CP4024 in which Satyabir Tomar, Rita Tomar, Smt. Kabuli Devi, Sandeep Tomar, Shivani Tomar and Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. driver Ombeer Singh were travelling. When he reached the spot, he found his uncle Satyabir Tomar and cousin Sandeep Tomar grievously injured and other four occupants including the driver dead. He further testified that he was hardly 100 metres away following the Toyota Qualis and injured were removed to Civil Hospital in police van. Further, the accident occurred due to wrongful driving on the part of driver of the truck.
On crossexamination, PW4 denied that the road where the accident occurred was a busy road in the evening hours. Further, Toyota Qualis did not stop at the toll tax while he had stopped his vehicle at the barrier which resulted in the distance between Toyota Qualis and his car which was driven at a speed of 55 KMPH. He denied the suggestion that there were other vehicles plying on the road between his car and Toyota Qyalis. He clarified that the accident occurred on a straight highway and the width of the road was about 78 metres but there was no streetlight on the straight highway and near the place of occurrence. He denied the suggestion that the truck could not have been driven at a fast speed since it was approaching the toll tax barrier and on the contrary since the Toyota Qualis had crossed the toll tax barrier, it was being driven at a fast speed. He denied that driver of the Toyota Qualis was unable to control and rammed into the truck coming from the opposite side after moving to the wrong side of the road. He further denied the suggestion that he did not witness Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. the accident or had reached the spot after occurrence of the accident or that driver of the truck was not at fault. He deposed that his statement was recorded by the police and his signatures were obtained thereon.
9. PW5 Rakesh Gupta, Accounts Clerk with Shri Ashok Kumar Aggarwal, Chartered Accountant produced the original record in respect of Income Tax Returns, computation of income and Balance Sheet of deceased Smt. Rita Tomar and Shri Satyabir Singh Tomar and audit reports of M/s Tomar Constructions Company (Ex.PW5/Acolly page 1 to 162). He further stated that Shri Satyabir Singh Tomar was the Sole Proprietor of M/s Tomar Construction Company.
On crossexamination, he stated that he was working as Accounts Clerk with Shri Ashok Kumar for about last 5 years but had no documentary proof in that respect. Further, his duties included filing of documents and obtaining signatures on the documents etc. He could neither tell about the nature of relationship between Shri Ashok Kumar Aggarwal and the claimants nor the basis on which documents Ex.PW5/A (colly) had been prepared. He further stated that he did not know as to whether claimants were maintaining books of accounts and had neither looked after the income tax account of the claimants or ever visited income tax department on their behalf. Further, Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. he had no personal knowledge of accounts or income tax aspect of the claimants.
10. PW7 Ms. Meenakshi Bhardwaj, Record Room JSCC, Tis Hazari proved true copy of the certified copies contained in the file bearing internal numbers from Sl. No.91 to 147 consisting of 57 sheets (Ex.PW7/A colly).
11. PW8 Ramesh Gupta, Senior Tax Assistant, Income Tax Department Circle 38(1) proved the true attested copies of the assessment record for the Assessment Years 2001 2002 and 20022003 pertaining to Shri Satyabir Singh Tomar, Proprietor M/s Tomar Construction Company consisting of 8 sheets (Ex.PW8/A colly), authority letter issued in his favour by Shri Amreek Singh, Asstt. Commissioner of Income Tax (Ex.PW8/B), attested copy of Income Tax Returns of Shri Satyabir Singh Tomar, Proprietor of M/s Tomar Construction Company for the Assessment Year 20012002, 20032004 and 20042005 (consisting of 12 sheets) attested by Shri Amrik Singh, Assistant Commissioner whose signatures he identified as he had seen him writing and signing. He stated that record for the Assessment Year 20022003 was not available.
On crossexamination, he stated that there was no Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. separate attestation department in the office and he had no personal knowledge about the assessment made in the present case.
12. PW9 Daya Nidhi, Senior Judicial Assistant, Record Room, High Court of Delhi proved certified copy of order dated 21.02.2012 in MAC APP 27 of 2010 (Ex.PW9/A), certified copy of index dated 07.03.2012 along with evidence by way of affidavit (Ex.PW9/B colly), certified copy of list of documents dated 02.01.2010 along with six pages of documents (Ex.PW9/C colly), certified copy of statement of Shri Sandeep Tomar dated 29.03.2012 recorded in MAC APP No. 27 of 2010 along with the judicial order dated 29.03.2012, cross examination of Shri Sandeep Tomar dated 30.03.2012, statement of counsel for appellant closing additional evidence on behalf of the appellant dated 30.03.2012 and the judicial order in MAC APP No.27/2010 dated 30.03.2012 (Ex.PW9/D colly) from the record brought by him.
During crossexamination, he admitted that record which he had brought consisted of other documents and judicial orders which he had not placed on record.
13. PW10 Kailash Chand Bairwa, Tax Assistant/Record Clerk, Office of the Assistant Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Commissioner of Income Tax Circle 62(1), New Delhi proved certified copy of Income Tax Return of M/s Tomar Construction Company for the Assessment Years 20052006 (Ex.PW10/A); 20062007 (Ex.PW10/B); 20072008 (Ex.PW10/D); 20082009 (Ex.PW10/F); certified copy of SARAL form for the Assessment Year 20062007 (Ex.PW10/C) and certified copy of SARAL form along with computation of net assessable income for the Assessment Year 20072008 (Ex.PW10/E). He further placed on record certified copy of Income Tax Returns filed on behalf of Tomar Construction Company pertaining to Assessment Year 200607, 200708 and 200809 along with certificate u/s 65B of Indian Evidence Act and proved Income Tax Return for the Assessment Year 200506 consisting of SARAL Form along with processing sheets prepared by the department (Ex.PW10/A1colly page no.01 to 09); Income Tax Return for the Assessment Year 200607 along with audit report filed by the assessee (Ex.PW10/B1colly page no. 10 to 49); Income Tax Return for the Assessment year 200708 consisting of SARAL Form along with computation sheet and audit report submitted by the assessee (Ex.PW10/D1) and Income Tax Return for the Assessment Year 200809 which is the certified copy of return as per Efiling (Ex.PW10/F1)colly page no. 99 to 110).
On crossexamination on behalf of Insurance Company, he admitted that page no.3,4,7,8, 11 to 48, 51 to 86 Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. and 89 to 109 did not bear the stamp of certified true copy along with signatures. Further, he had not brought the original SARAL Form bearing page no.1 (Ex.PW10/A1) which might have been filed by the assessee. He deposed that as per his knowledge the certified copy had been attested on the basis of photocopy available in the office as the original was not available and further normally the certified copy was prepared on the basis of original. He further stated that documents as mentioned in Ex.PW10/A1 page 01 were not available in the office as reflected at PointA. He was not aware as to the constitution of Tomar Construction Company as he had simply brought the record as available in the office and had no personal knowledge in respect of the said returns.
He further deposed that he was not aware as to which officer had dealt with the aforesaid returns which had been filed by the assessee and Ms.Shikha Semwal was the Officer Incharge of the circle within which the record pertaining to the returns had been maintained. He also deposed that the files pertaining to the returns filed by the assessee for the assessment year 2005 06 were not available except for Ex.PW10/A1 though being the Record Clerk of the concerned section he had tried to trace the relevant files. He was not aware as to the details of filing of returns in each file except for the record which was brought by him and if in case the Commissioner had passed orders in respect of assessment year 200506.
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
He had not brought the record of Income Tax return for the assessment year 200809 as the same was electronically filed and Ex.PW10/F1 had been filed on record. Further, hehad also not brought the record regarding the assessment order and amount refunded, if any for assessment year 200809. He further stated that he had brought the complete efiling record of Ex.PW10/F1 as was available in the system along with the complete electronic record pertaining to assessment year 2008
09. He was not aware in case the firm Tomar Construction Company was assessee of Income Tax as on date since he had not checked the same and could not say whether it was mandatory to file a partnership deed for each year along with the Income Tax Return.
He further deposed that he had brought the files as available in the office record pertaining to the assessment year 200607 and 200708 and the copies of partnership deed, if any filed, along with the return by the assessee had not come to his notice.
On perusal of file pertaining to assessment year 200607 and 200708, he stated that the same did not contain the partnership deed and denied the suggestion that he had not brought the entire record of the assessment year 200506 to help the assessee.
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
14. PW11 Virendra Kumar, Executive Engineer, CPWD, Office of the Chief Engineer, CSQ (Civil), CPWD, Nirman Bhawan, New Delhi stated that the eligibility criterion for getting fresh enlistment with CPWD had been defined in Enlistment Rules 2005 and was available as per Appendix 34 of CPWD Works Manual 2007 at Pages 380 to 395 for various classes and categories. Further, the CPWD Works Manual 2007 was published by Director General (Works) CPWD, Nirman Bhawan and proved copy thereof (Ex.PW11/A). He further stated that in case of a proprietorship firm if the proprietor registered for participation for contracts with CPWD expires, the firm becomes ineligible for future participation and the experience and turnover of said firm cannot be carried forward for the purpose of further registration/renewal of firm, may be in the same name. He further volunteered that the same is not specified in the CPWD Manual/Enlistment Rules in case the registered proprietor expires. He further proved Rules of Enlistment of Contractors in CPWD, 2005 which were separately published (Ex.PW11/B 45 pages). He further deposed that fresh partnership firm which did not have requisite experience as per eligibility criterion might not be eligible for registration of firm with CPWD and it was possible that for award of contracts by certain institutions the preregistration with CPWD was necessary.
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
During crossexamination on behalf of insurance company, he stated that he was not aware as to the status of Tomar Construction Company and could confirm the status of registration of Tomar Construction Company with the CPWD only if the registration details were provided. Further, the enlistment rules which had been produced pertained to year 200508 and later on some amendments had been made. Prior to 2005, the enlistment rules notified for the period 200104 were applicable but he had not brought the enlistment rules 200104.
He further stated that if a proprietor contractor died during the awarded contract, then as to who would continue rest of the awarded contract in context of partnership firm was provided at page 03 para no.15.3 of the Enlistment Rules Ex.PW11/B.
15. PW6 Sandeep Tomar testified on the lines of the claim petition.
It may further be noticed that Shri Sandeep Tomar was also examined as AW1 before the Hon'ble High Court wherein he tendered his additional evidence by way of affidavit (Mark A). He proved receipted copy of communication No. TCC/WD06/149/200405/228 dated 18.01.2005 addressed by him to the Executive Engineer, Western Division No.6, DDA, Mangla Puri, New Delhi45 informing about the death of his Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. father and requesting for termination of the contract under clause 39 of the agreement (Mark AW1/1) and reply dated 01.06.2005 received in response thereof from the Executive Engineer, Western Division No.6, DDA, Mangla Puri, New Delhi45 (Ex.AW1/2); receipted copy of communication dated 14.02.2005 addressed by him to the Executive Engineer, PWD Division No. 27, Dabri Police Station Building, Dabri, New Delhi45 informing about the death of his father and requesting for termination of the contract under clause 39 of the agreement (Mark AW1/3) and reply received in response thereof from Executive Engineer, PWD Division No. 27, Dabri Police Station Building, Dabri, New Delhi45 (Ex.AW1/4); copy of communication dated 01.03.2005 sent by him to the Regional Manager, RIICO Ltd., Shahjahanpur, Rajasthan informing about death of his father and requesting for termination of the contract under clause 44 of the agreement (Mark AW1/5) and response to the same received from Regional Manager, RIICO Ltd., Shahjahanpur, Rajasthan about the termination of contract agreement under clause 44 (Ex.AW1/6).
On crossexamination, he stated that he had not produced the agreement referred to in the communication dated 01.06.2005 (Ex.AW1/2); agreement referred to in Ex.AW1/4; contract agreement referred to in communication dated 06.02.2005 (Ex.AW1/6). He denied the suggestion that after the demise of his father on 30.12.2004 he along with his brother Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Sumit Tomar took over the business run by his father. He further denied the suggestion that he along with his brother took over the contracts referred to in Ex.AW1/2, Ex.AW1/4 and Ex.AW1/6 after completion of the procedure of closing the contracts which stood in the name of his father.
PW6 Sandeep Tomar after remand back of the case further filed his additional affidavit by way of evidence and testified that he had also been examined as AW-1 in MAC Appeal No.27/2010 before the Hon'ble High Court of Delhi. He further testified that deceased Late Shri Satyabir Singh Tomar was engaged in construction business and PW6 had no experience of construction business but perforce had to constitute a new partnership firm namely M/s Tomar Construction Company along with his brother, who was a student of BBA to mitigate the losses. He further testified that the new firm was incapacitated to bid for high value contracts of Government and statutory bodies as it did not possess the financial capacity and experience mandatory for the same. He further proved the original general conditions of contracts work for CPWD works for the year 2001 (Ex.PW6/B), computer printouts of CPWD enlistment Rules 2005 modified upto 18.01.2013 published by Directorate General of Works, Nirman Bhawan (Mark-C).
On cross-examination on behalf of Respondent No.2, he deposed that he had never worked with his father Late Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Satyabir Singh Tomar. Further M/s Tomar Construction Company was a sole proprietary concern of his father and consequent upon his demise the same was closed down. He further stated that he was in construction business and running a company by the name of Tomar Construction Company in partnership with his younger brother Sumit Tomar. Further the nature of business as was being run by his father and now being run by him along with his brother is same. He also stated that they had not undertaken any CPWD projects in the new partnership firm.
On cross-examination on behalf of Respondent No.3 Oriental Insurance Company Ltd. he clarified that his father was MA but he was not sure and had not brought marksheet from 10th till MA. Further his father was not technically qualified. He further deposed that the Income Tax Return for the period from 1 st April 2004 to 31st December 2004 had been filed by him after the death of his father along with profit and loss account, balance sheet, audit report computation, TDS etc. Further he had not brought books of account i.e cash book ledger and other books maintained by the Tomar Construction Company for the period 1st April 2004 to 31st December 2004 as the same were not available in the office.
He further stated that his brother was doing another business of Technical Support related to computers besides being a partner in M/s Tomar Constructions since 2011. Further his brother Sumit was an active partner in the firm and was filing his personal ITR from 2005 onwards till date. He further Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. proved his personal income tax returns for the financial year 2004-05 till 2007-08. On being shown income tax return Ex.PW10/A1 for the period 31.12.2004 to 31.03.2005 he submitted that the same pertains to partnership firm which started the business from 31.12.2004 and had taken over all the assets and liabilities of M/s Tomar Construction Company as on 30.12.2004. He further stated that some of the projects were continued by new partnership firm after entering into fresh agreement and some of the income shown in the Income Tax Return for the period after 31.12.2004 pertains to income generated for the projects prior to 31.12.2004.
He further stated that his father was enlisted as contractor with CPWD and the new partnership firm was not enlisted with CPWD for any class as the same did not meet with the necessary eligibility conditions.
He further proved his ITRs for the assessment year 2005-06 to 2008-09 (Mark-D1 to Mark-D4) and ITRs in the name of Sumit Tomar for the assessment year 2005-06 to 2008- 09 (Mark-D5 to Mark-D8).
Evidence was not led on behalf of the respondents.
16. I have heard arguments addressed on behalf of the petitioners, counsel for respondents and perused the record. Written submissions were also filed on behalf of petitioners as well as counsel for insurance company.
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
17. My Issue-wise findings are as under :-
Issue No. (i) Whether the deceased Kabuli Devi, Satyabir Singh Tomar, Ombeer Singh Tomar, Ms. Shivani Tomar @ Ruby and Smt. Rita Tomar received fatal injuries due to the rash and negligent driving of Truck Tanker HR-38-G- 7310 by respondent no.1?
In Bimla Devi and Ors. V. Himachal Road Transport Corporation and Ors., (2009) 13 SC 530, it was held that in a petition u/s 166 of the Motor Vehicles Act, 1988 the Claim Tribunal has to decide the negligence on the touchstone of preponderance of probability and holistic view is to be taken while dealing with the Claim Petition. In New India Assurance Co. Ltd. V. Sakshi Bhutani & ors, MAC APP. 550/2011 decided on 02.07.2012 by Hon'ble Mr. Justice G.P. Mittal (Delhi High Court), it was observed that it has to be borne in mind that the Motor Vehicles Act does not envisage holding a trial for a petition preferred under Section 166 of the Act. Under Section 168 of the Act, a Claims Tribunal is enjoined to hold an inquiry to determine compensation which must appear to it to be just.
Strict rules of evidence are not applicable in an inquiry conducted by the Claims Tribunal. Further in State of Mysore Vs. S.S. Makapur, 1993 (2) SCR 943, Hon'ble Supreme Court Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. held that the Tribunals exercising quasi-judicial functions are not courts and are not bound by strict rules of evidence. The relevant portion of the report is extracted hereunder:
".......that tribunals exercising quasi- judicial functions are not courts and that therefore they are not bound to follow the procedure prescribed for trial of actions in courts nor are they bound by strict rules of evidence. They can unlike courts, obtain all information for the points under the enquiry from all sources, and through all channels, without being fettered by rules and procedure, which govern proceedings in court. The only obligation which the law casts on them is that they should not act on any information which they may receive unless they put it to the party against whom it is to be used and give him a fair opportunity to explain it. What is a fair opportunity depend on the facts and circumstances of each case but where such an opportunity has been given, the proceedings are not open to attack on the ground that the enquiry was not conducted in accordance with the procedure followed in courts."
Reference may also be made to observations in Ranu Bala Paul & Others vs. Bani Chakraborty 1999 ACJ 634 Gauhati wherein the claim was allowed after consideration of FIR before the Tribunal.
"In deciding a matter Tribunal should bear in mind the caution struck by the Apex Court that a claim before the Motor Accident Claims Tribunal is neither a criminal case nor a civil case. In a criminal case in order to have conviction, Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
the matter is to be proved beyond reasonable doubt and in a civil case the matter is to be decided on the basis of preponderance of evidence, but in a claim before the Motor Accident Claim Tribunal the standard of proof is much below than what is required in a criminal case as well as in a civil case. No doubt before the Tribunal, there must be some material on the basis of which the Tribunal can arrive or decide things necessary to be decided for awarding compensation. But the Tribunal is not expected to take or to adopt the nicety of a civil or of a criminal case. After all, it is a summary enquiry and this is a legislation for the welfare of the society. In N.K.V. Bros. (P) Ltd. v. M. Marumai Ammal, 1980 ACJ 435 (SC), the Supreme Court pointed out that the Accidents Claims Tribunal must take special care to see that innocent victims do not suffer and persons liable do not escape liability merely because of some doubt here and some obscurity there. The court should not succumb to niceties, technicalities and mystic maybes. The court is bound to take broad view of the whole matter."
At the outset, it may be observed that three connected cases stand settled in Lok Adalat and also the point of rash and negligent driving stands decided in Suit No.654/08 and 655/08. Even otherwise, it may be observed that evidence of PW4 Parvinder Singh, who is an eyewitness to the accident along with PW6 Sandeep Tomar clearly reflects that the accident had been caused due to rash and negligent Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. driving of the offending vehicle bearing registration no.HR 38 G 7310. The testimony of the witnesses could not be dented during cross-examination and the cause of death also stands corroborated by the postmortem report. It may also be noticed that Respondent No.1 failed to appear in the witness box to rebut the evidence on record and no complaint appears to have been filed with any higher authority alleging false implication. Considering the fact that negligence is to be assessed on touchstone of preponderance of probability and a holistic view is to be taken, it has been established that the accident was caused due to rash and negligent driving of HR 38 G 7310 by Respondent No.1. Issue No. 1 is decided in favour of the petitioners and against the respondents.
18. Issue No. (ii) Whether the petitioners are entitled to any compensation? If so, what amount and against whom?
19. Briefly the contentions raised by counsel for petitioners may be noticed:
(i) It was contended that the average income of the deceased Satyabir Singh Tomar aged about 47 years on the date of accident as per the income tax returns for the last three years was Rs.80,00,000/- per annum and applying the multiplier of 13 the loss of dependency Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
needs to be accordingly assessed. The multiplier of 05 adopted by the Ld. Predecessor vide award dated 30.09.2009 at an average income of Rs.65,00,000/- was vehemently disputed. Reliance was further placed upon Sarla Verma vs. DTC, 2009(6) SCC, page 121, National Insurance Company Ltd. vs. Indira Srivastava 2008 (2), SCC, Page 763, Ranjana Prakash vs. Divisional Manager 2011 STPL-WEB-655 SC, Vimal Kanwar vs. Kishore Dan 2013 STPL-WEB-386 SC and National Insurance Co. Ltd vs. Baldev Kalra, MACA No.864/14 decided by Hon'ble Delhi High Court vide judgment dated 22-914.
(ii) It was pointed out that petitioner no.1 & 2 were financially dependent upon their father Sh. Satyabir Singh Tomar at the time of his death as they were merely aged about 21 years and 18 years respectively. Further petitioner no.1 was pursuing his education in field of Information Technology in Australia and was also doing a part time job but due to the accident, he could not return back to Australia and was constrained to give up his further education and prosperous career. Further petitioner no. 2 was a school going student at the relevant time.
(iii) It was further contended that vide order dated 25.05.2012, Hon'ble High Court took note of the facts that the Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. sole proprietorship firm of father of petitioners had come to an end with his death. It was urged that thereafter inexperienced petitioners were compelled to make an altogether fresh beginning into construction business and floated a new partnership entity under the name of 'M/s Tomar Construction Company' but this new firm had no experience and requisite turnover to participate in the new tenders floated by any government agency. Further, petitioners were taking care of the projects left by the deceased, just in order to escape the liability of losing the security deposit and to get released their due payments. It was also pointed out that petitioners were having big contracts in their hands which were like huge liabilities and were compelled to carry on some loss making contracts in order to save their high security deposit. Further, they were pursuing certain old contracts but it was done out of compulsion and not by choice.
(iv) It was further contended that the petitioners had taken up the current business after the demise of their father by the force of circumstances and the income had no co-relation with the loss caused due to death of their father.
(v) It was also submitted that new partnership concern was not eligible to bid for new government contracts due to want of experience, turnover etc. guidelines, general conditions of contracts. Further, enlistment criteria as framed by CPWD is Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. taken as a basic standard for all governmental agencies. Reliance was placed upon Ex.PW6/B and it was submitted that the general conditions for contracts of CPWD works on page 3 specify the conditions of issue of tendered documents and page 56 clause 39 specifically lays down that 'Without prejudice to any of the rights or remedies under this contract if the contractor dies, the Divisional Officer on behalf of the President of India shall have the option of terminating the contract without compensation to the contractor.' It was further submitted that enlistment rules (Mark C, later exhibited as Ex.PW11/B), prescribes various checks for enlistment. Reliance was placed upon relevant portions at point 6,4,7,11.1, 15.0, 15.1, 15.2, 15,3, 19.0, 21.0 and 23.3 G. Clause 12 and 13 of enlistment form requiring details of technical staff and machinery etc. It was pointed out that Annexure-II demands completion of various formalities as mentioned in document code 3,4 and 5 and Table I of enlistment rules lists the need of minimum conditions of work having certain financial strength.
(vi) It was next contended that death of Satyabir Singh Tomar resulted in cancellation of various contracts and reliance was placed upon Ex.PW9/A, Ex.PW9/B, Ex.PW9/C and Ex.PW9/D.
(vii) Additional written submissions dated 05.09.2016 were further filed on record, in the light of vehement dispute Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. regarding the assessment of income of the deceased on the basis of Income Tax Returns. In nutshell, the contentions may be further noticed as under:
(a) That the grounds taken for challenging the ITRs were not taken in the written statement and the evidence beyond the pleadings could not be looked into.
(b) That PW1, 6 & 5 were not cross-examined regarding the source of income and manner of filing returns and no effort was made by respondent to summon any expert witness to prove the assertions made in the contentions at stage of final arguments.
(c) That the respondent was wrongly projecting the aspect of interest income earned by the deceased without referring to the interest paid by deceased for the loans availed by him. The returns filed by deceased were further stated to be duly audited which stood the scrutiny of Income Tax Department.
(d) The analogy drawn by counsel for respondent was further challenged to be incorrect. It was submitted that the contentions raised by counsel for insurance company that interest income from FDRs is not part of business income, is on wrong conception of facts as these instruments were essential part of contractorship business and the FDRs and KVPs were used as guarantees/security for obtaining and performing the contracts. Further, the FDRs, KVPs and bank Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
guarantees were required to be deposited with the agencies as performance guarantee after completion of work for the period of maintenance as well. It was urged that since the firm was not having cash reserves, hence, the secured loans were used to be taken against these FDRs as per the need of situation and the details of the secured loans along with interest paid on them had been proved on record.
It was also claimed that the interest paid on the loans to the banks is more than the interest paid by the banks by way of interest. As such, it was submitted that as per Profit & Loss Account, deceased S.S. Tomar was getting interest on bank FDRs and at the same time was paying interest on bank FDRs pledged with the banks.
It was clarified with respect to the ITRs filed that if the interest received was higher and interest paid was less, it was income and was shown at income side of Profit & Loss Account as is done for the AY 2001-02, 2002- 03, 2003-04 and 2005-06. It was urged that for these years, gross interest received minus interest paid is the net figure taken up in Profit & Loss Account for the purpose of income tax. Further, where the interest paid was higher and interest received was less, it was loss and was shown on expenses side of Profit & Loss Account as is done for AY 2004-05.
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
It was claimed that the insurance company had wrongly projected the income as per the written submissions filed on their behalf as except for AY 2001-02, the insurance company had taken the net interest into consideration while for other years it had taken gross interest into consideration.
(e) It was also submitted that income declared in the IT survey for the Assessment Year 2003-04 pertained to the relevant year and could not be taken for the previous years as contended by counsel for insurance company since no interest and penalty for delayed payment had been imposed by the Income Tax Department.
(f)The income as projected by counsel for insurance company was further disputed on various grounds as detailed in the additional written submissions. The income of the deceased was further projected for the relevant Assessment Years as tabulated below:
Assessment Year 2001- 2002- 2003- 2004- 2005-
2002 2003 2004 2005 2006 (9
months)
Financial Year 2000- 2001- 2002- 2003- 2004-
2001 2002 2003 2004 2005
Income from 4153666 5462600 15256378 9459670 7705170
business-It is not
gross income
Proportionate Tax 1370709 1640255 4789269 3100129 257502
including surcharge
Business income 2782956 3822345 10467109 6359540 5132667
after Tax
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
20. On the other hand, the contentions were vehemently opposed by the counsel for insurance company and following contentions were raised:
(i) It was urged that in MAC Appeal 53/2010 decided on 25.05.2012 by the Hon'ble High Court relating to Suit No.655/08 in respect of death of Rita Tomar (mother of petitioners) it was held that the petitioners were not financially dependent on the mother but in the peculiar facts and circumstances took 50% of the deceased income as saving coming to the hand of petitioners as loss to estate which amounted to Rs.5,53,000/-. Further an amount of Rs.1,00,000/-
was awarded on account of gratuitous services.
(ii) It was pointed out that the ld. predecessor of the tribunal vide award dated 30.09.2009 had observed that the assessment of the financial dependency in this case cannot be on the basis of traditional multiplier method since the petitioner would not remain financially dependent on their father for all their life. Further the same was assessed for a period of five years for younger son who was aged about 18 years at the relevant time and for two years for petitioner no.1 who was aged about 21 years on the date of accident for establishing themselves. The compensation was further stated to have been distributed on the aforesaid consideration between petitioner Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. no.1 & 2.
It was also submitted that loss of dependency was calculated after taking the average income of deceased as Rs.65,00,000/- per annum and applying the deduction of 1/3 for the personal expenses but the same was disputed.
(iii) It was further submitted that there was no loss of income to the petitioners as they had inherited the running business of their father which was continued by the petitioners by opening a new entity in the name of M/s Tomar Construction Company which was a partnership concern.
(iv) It was urged that for the purpose of computing income of Tomar Construction Company sole proprietorship concern run by the deceased, the agriculture income is to be excluded as admitted on behalf of the petitioners during cross- examination of PW6 on 04.04.2008 as well as income on FDRs/Kisan Vikas Patra.
(v) The income of the deceased was further challenged on the ground that no books of account were produced and the income tax record for the assessment year 2002-03 was not available in the income tax department as deposed by PW8. The business income shown in the Income Tax Returns was further stated to be incorrect on the ground that interest income of FDR, Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. KVP had been wrongly included for calculating the loss to the family. It was submitted that the income declared at the time of survey in the net profit shown in the assessment year 2003-04 was not to be included while calculating the loss/damage.
(vi) It was claimed that the petitioner no.1 was permanent resident of Australia and no document had been filed to show that deceased was sending any remittance/financial help abroad to petitioner no.1. It was further urged that petitioner no.1 had completed his BIS course in September 2001 and was earning in Australia and as such was not dependent on the deceased. Reliance was further placed upon UP State Road Transport Corporation vs. Trilok Chand 1996 (4) SCC 362 for calculation of loss to estate.
(vii) It was further submitted that the petitioners stepped into the shoes of their father (deceased Satyabir Singh Tomar) and carried on the same construction business without any interruption from 31.12.2004 with the same name and on the same address but as a partnership firm. It was urged that the Tomar Construction Company (Partnership Firm) (PAN No.AAEFT0816D) filed its first income tax return for the period 31.12.2004 to 31.03.2012 AY 2005-06 but the copy of partnership deed mentioned at S.No.6 and 7 as mentioned is not available. The partnership deed copy PW6/X filed in the court was stated to be not correct as the stamp paper was dated Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. 13.05.2015 and partnership deed was made on 18.02.2005.
The partnership firm is further stated to have started work on existing contracts which were obtained by the proprietorship company.
It was also submitted that PW10 filed the record of income tax return, profit and loss account. Balance sheet etc. for assessment year 2005-06 to 2008-09 (period from 31.12.2004 to 31.03.2008) and from the same it can be inferred that the petitioners were earning handsome amount from the firm of their father which they have inherited. The income of the partnership firm was stated on account of capital, machinery, goodwill etc. of the proprietorship firm and as such it was claimed that petitioners had not suffered any business loss.
Petitioner no.1 is further claimed to have filed the individual Income Tax Returns and as such it was submitted that the petitioners had been handsomely earning.
It was further submitted that petitioners had not filed any documents to prove that they were declined to be awarded any contracts due to inexperience, requisite turnover and non- enlistment with CPWD. It was claimed that 'Tomar Construction Company (proprietorship firm)' was not enlisted with CPWD at the time of death of S.S. Tomar as enlistment expired on 13.09.2003. No proof was stated to have been filed regarding renewal of enlistment with CPWD by the deceased Satyabir Singh Tomar during his lifetime. It was also contended that petitioners had not filed any proof that partnership firm had Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. applied for enlistment and they were rejected by CPWD for want of experience/turnover.
It was next submitted that the petitioners had not filed the copy of contract/agreement of the clients to show the contents of Clause 39 and 44 and CPWD Rules filed by the petitioners did not relate to the period of death of Satyabir Singh Tomar. Reference was further made to details of ITR returns as calculated by the counsel for insurance company in Annexure-1 to 4.
21. Section 168 empowers the claims tribunal to make an award determining the amount of compensation which appears to be just. The object remains to save the dependents from being deprived of the source of their maintenance and as far as possible to provide them with the means as were available to them in pre-accident period.
Hon'ble Apex Court in Sheikhupura Trans. Co. Ltd. vs. Northern India Transporters Insurance Company Ltd. 1971 ACJ 206 (SC) observed as under:
"......the pecuniary loss to the aggrieved party would depend upon data which cannot be ascertained accurately but must necessarily be an estimate or even partly a conjecture.... The determination of the question of compensation depends on several imponderables. In the assessment of those imponderables, there is likely to be margin of error....."
Further in General Manager, Kerala State Road Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Corporation vs. Susamma Thomas, 1994 ACJ 1 (1), Hon'ble Apex Court held:
"(7) The assessment of damages to compensate the dependents is beset with difficulties because from the nature of things, it has to take into account many imponderables, e.g., the life expectancy of the deceased and the dependents, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependents during that period, the chances that the deceased may not have lived or the dependents may not live up to the estimated remaining period of their life expectancy, the chances that deceased might have got better employment or income or might have lost his employment or income altogether.
The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependents, and to deduct therefrom such part of his income as the deceased was accustomed to spend upon himself, as regards both self-
maintenance and pleasure, and to ascertain what part of his net income the deceased was accustomed to spend for the benefit of the dependents. Then that should be capitalised by multiplying it by a figure representing the proper number of years' purchase.
Much of the calculation necessarily remains in the realm of hypothesis 'and in that region arithmetic is a good servant but a bad master' since there are so often many imponderables. In every case 'it is the overall picture that matters' and the court must try to assess as best as it can be loss suffered."
22. At the outset, it may be observed that the contention raised by counsel for insurance company that petitioners did not suffer any loss of income since the business income continued to the petitioners from the business of construction as per Income Tax Returns filed on behalf of the petitioners, appears to be Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. fallacious.
It may be appropriate to refer to the principles involved in assessment of compensation for loss to estate and loss of dependency as referred in Dinesh Adhlak vs. Pritam Singh & Ors. ILR (2010) V Delhi 463 (MAC Appeal No.253/07 decided on 15.01.2010 by Hon'ble Mr. Justice J.R. Midha).
In Dinesh Adhlak (supra), deceased (wife of the petitioner) aged about 31 years was working as a teacher while her husband aged 34 years was working as a teacher at Jesus and Merry College and was not financially dependent upon the deceased. It was held by the Hon'ble High Court that the husband is entitled to compensation for loss to estate and not for loss of dependency since he was not financially dependent upon the deceased. The principles as settled in A. Manavalagan vs. A. Krishnamurthy & Ors., 2005 ACJ 1992 by the Hon'ble Karnataka High Court as referred in Dinesh Adhlak (supra) are further apt to be quoted:
"19 (iv). The procedure for loss of estate is broadly the same as procedure for determination for loss of dependency. Both involve ascertaining the multiplicand and capitalising it by multiplying it by an appropriate multiplier. But the significant difference is in the figure arrived at as multiplicand in cases where the claimants who are dependents claim loss of dependency, and in cases where the claimants who are not dependents claim loss to estate. The annual contribution to the family constitutes the multiplicand in the case of loss of dependency, whereas the annual savings of the deceased becomes the multiplicand in the case of loss to estate. The method of selection of multiplier is however the same in both cases".
" 20 (v)........Though the quantum of savings will vary from person to person, there is a need to standardise Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
the quantum of savings for determining the loss to estate (where the claimants are not dependents) in the absence of specific evidence to the contrary. The quantum of savings can be taken as one-third of the income of the deceased where the spouses are having a common establishment and one-fourth where the spouses are having independent establishments. The above will apply where the family consists of non- dependent spouse/children/parents. Where the claimants are non-dependent brothers/sisters claiming on behalf of the estate, the savings can be taken as 15% of the income. The above percentages, one of course, subject to any specific evidence to the contrary led by the claimants."
It may also be appropriate to refer to judgment passed in Maharashtra State Road Transport Corporation vs. Shrishail Basavraj Katagi & Ors. 2005 SCC Online Bombay 1108: 1AIR BOM R 678 by Hon'ble High Court. In the aforesaid case, the deceased had left behind his wife aged about 45 years, two major sons, a son aged about 17 years and a daughter aged about 15 years. The deceased was carrying business of dealership of fertilizer and had a share of 50% and the two sons were also partners of remaining 50% in the said firm. The income/profit for the relevant year 1984-85 was Rs.66,000/- apart from agriculture income. It was urged on behalf of insurance company that since the returns of the subsequent years have not been finalised, the loss of income as a result of death of father had not been established. The aforesaid contention was not accepted by the Hon'ble Court and it was observed that while arriving and deciding the question of compensation which is to be paid or the loss which was caused to the family cannot be weighed in golden scale but a Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. overall view has to be taken to find out the extent of loss which the family had suffered. If the arguments advanced by ld. counsel appearing on behalf of appellants is accepted, it would take us to the absurd conclusion that in fact, after the death of father no loss caused to the family and in fact they have somehow benefited in some respect. Further considering the fact that the widow was aged about 45 years and the sons and daughter were still aged about 17 and 15 years, the multiplier was taken as 12 instead of 07 as taken by the Tribunal. Further, despite the fact that the father had a share of 50% in the firm as two of the major sons were partners, it was held that the income of the deceased has to be taken as Rs.66,000/- since it cannot be forgotten that very often for the purpose of distribution of tax liability for the benefit of the family members, sons are made partners in the business. Accordingly, the deduction towards personal expenses was made for Rs.21,000/- and it was considered that an amount of Rs.45,000/- would have been spent by the deceased on his dependents.
It may be noticed that in the present case the claimants who are the sons of the deceased were at tender age of 18 and 21 years and the construction business carried by the deceased was largely based upon personal skills, experience and empanelment as a Class-I contractor. The mere continuation of the business by the claimants in the name of a new entity which was a partnership concern, cannot lead to a presumption that there was no loss of personal managerial skills of the deceased Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. for carrying such a large scale business based on his experience and empanelment as Class-I contractor. As such, the contention raised by the counsel for insurance company that the petitioners are not entitled to any compensation, is without any merit.
23. It may also be noticed that in connected appeal bearing No. MAC Appeal No. 53/2010 dated 25.12.2012 decided by Hon'ble Mr. Justice G.P. Mittal relating to compensation in respect of death of mother of petitioners Smt. Rita Tomar, it was observed that though the petitioners were not financially dependent on their mother yet the surplus income of the mother would come to appellants' hands as loss to estate. As such, instead of granting compensation on the basis of gratuitous services by the Tribunal, the same was calculated by the Hon'ble High Court on the basis of ITRs returns filed by the deceased mother of the petitioners wherein income was disclosed @ Rs.7,000/- per month. Further 50% of the deceased's income was taken as savings coming to the hands of the petitioners as loss to estate and the compensation was accordingly assessed at Rs.5,53,000/-. Further, a lump-sum amount of Rs.1,00,000/- was awarded towards the gratuitous services apart from loss of love and affection.
In the aforesaid background, it may be observed that deceased Satyabir Singh Tomar aged about 47 years at the time of the accident would have successfully continued the roaring business at least for a period of next 15-20 years and the surplus income generated after deduction towards personal expenses Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. would have accordingly come to the hands of petitioners as savings or loss to estate. So, even if the petitioners were not financially dependent, they would still have been entitled to compensation for loss to estate out of savings of deceased.
24. However, in the present case since petitioners were just aged about 21 & 18 years at the time of death of deceased, the compensation needs to be assessed on the basis of loss of dependency in the light of evidence and facts and circumstances on record and considering the fact that petitioner no.2 was as student and petitioner no.1 was in the process of settlement abroad.
It may be observed that what was the actual 'loss of dependency' to the family is the contribution of the deceased to run the business. The same may vary from the type of business being carried by the deceased and the fact whether the business was run on the basis of managerial skills exclusively, or the business involved a combination of managerial skills qua the capital assets which may still be available after his death. In the aforesaid background, it may be appropriate to refer and notice the decided cases wherein the loss of dependency has been assessed considering the aforesaid parameters.
(i) In MAC APP 300/2007 United India Insurance Co. Ltd. vs. Gurcharan Kaur & Ors. decided by the Hon'ble Mr. Justice R.K. Gauba (High Court of Delhi) on 25.05.2016, the case involved death of one Daljinder Singh aged 45 years Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. and the claimants happened to be wife and three daughters. As per the award dated 12.03.2007 in Suit No.333/03 passed by the tribunal, it was claimed by the claimants that after the death of deceased the petrol pumps run by the deceased had to be closed as there was no male member to look after the business and also the agriculture income had stopped. Further, being women it was not possible for the claimants to operate the transport business. In the award passed by the tribunal, it was observed that while the income from the interest remains unaffected by the death of the account holder, income from transport business and agriculture could get effected to some extent given the fact that the managerial/supervisory skills would not be available and as such the arguments that the entire income had come to a naught because of the death of the deceased was not accepted. Further, the loss of income was computed to the extent of being mitigated by 30% which was further enhanced by 50% keeping in view the age of deceased (45 years) and the scope of expansion/investment. Further, deducting 1/3rd towards personal expenses the dependency was calculated. In the appeal preferred on behalf of United India Insurance Company Ltd. as well as claimants, the Hon'ble High Court found the views of the tribunal to be appropriate but in view of the age of the deceased as per Sarla Verma (Smt.) & Ors. vs. Delhi Transport Corporation & Another (2009) 6 SCC 121 the future prospects qua increase of income were factored at 30% instead of 50%.
(ii) In (2009) 13 Supreme Court Cases 498 Rani Gupta Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. & Ors. vs. United India Insurance Company Ltd. & Ors. the loss of dependency was determined by the Hon'ble High Court in respect of the deceased, who was carrying a business at Rs.1,87,500/-per annum. The same was further apportioned as two-thirds as labour input i.e. personal input of the deceased and treated one-third as yield from capital assets as referred in para 6 of the judgment. The total loss of financial dependency after applying multiplier of 10(instead of 13 as applied by Ld. Tribunal) was held to be Rs.12,50,000/- but it was observed that the remaining loss of Rs.6,25,000/- could be made good by the family by renting out the factory or after liquidating the capital assets and investing the money in an annuity yielding income by way of interest. Hon'ble Apex Court upheld the decision of the Hon'ble High Court as observed in para 24 as under:
"24. In this case, however, the deceased was a businessman. What was the actual loss of dependency to the family was his contribution to run the business. The assets of the business remained. The amount of compensation, therefore, was required to be determined keeping in view that factor in mind. Application of the multiplier of 10, therefore, cannot be said to be bad in law. In terms whereof the amount of compensation would come out to Rs.12,50,000/-, although the High Court, in our opinion, might not, thus be entirely correct in opining that the remaining loss could be made good. We, however, need not delve into the said question any further as we are of the opinion that the ultimate decision of the High Court is correct."
It may also be noticed that in para 10, the approach of the tribunal for computing the future increase in income was also upheld as quoted below:
"10. The learned Tribunal, keeping in view the fact that within a short time, the appellant had been able to wipe off the entire loan taken by him from the bank and, thus, Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
became the owner of an industrial plot and furthermore in view of the fact that he was only aged 46 years at the relevant time, thought that his income would have doubled at the time of his death. We think that the approach of the learned Tribunal was correct."
25. Income of Deceased Satyabir Singh Tomar (Owner of Proprietorship concern M/s Tomar Construction Company) In the light of aforesaid principles for assessing the 'loss of dependency' or computing the loss of income due to death of deceased, the income of deceased Satyabir Singh Tomar needs to be assessed.
So far as the income of deceased Satyabir Singh Tomar is concerned, the same was earlier ascertained vide award dated 30.09.2009 at Rs.66 lacs on the basis of average of the Income Tax Returns for the assessment years 2001-02 {Rs.4229824 (i.e. Rs.6046604 net income - Rs.1816780 income tax paid)}, 2003-04 {Rs.6984579 (i.e. Rs.18951766 net income
- Rs.6984579 income tax paid)} and 2004-05 {Rs.6628936 (i.e. Rs.9448840 net income - 2819544 income tax paid)}. The income tax return for the assessment year 2002-03 was not taken into consideration since the return for the relevant year could not be proved on record. Further, the loss of dependency was calculated at Rs.2,16,66666/- after deduction of 1/3 rd on personal expenses and applying multiplier of 05 taking the dependency for 05 years.
However, in the present case, income of the deceased as earlier ascertained by the ld. Predecessor of the Tribunal has Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. been vehemently disputed on behalf of insurance company.
26. For proper appreciation of contentions as raised by counsel for insurance company, Annexure-1 of the written submissions as relied by the counsel may be reproduced:
Annexure-1 SN Assessment Year 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 1 Financial Year 01-04-2000 01-04-2001 01-04-2002 01-04-2003 01-04-2004 to 31-03- to 31-03- to 31-03- to 31-03- to 30-12-
2001 2002 2003 2004 2004
2 Income Tax Returns Return filed Return filed Return filed Return filed Return filed
filed on and by by Mr. by Mr. by Mr. Satbir by Mr. Satbir by Mr.
Satbir Satbir Singh Singh Tomar Singh Tomar Sandeep
Singh Tomar on on 01 Nov Tomar after
Tomar 31-10-2002 2004 death on 31-
10-2005.
3 Turnover Not 84774563 300970813 225275264 164828174
Available
4 FDR amount 36604503 65095859 80664553 94462276 114055366
mentioned in
balance sheet
5 Kisan Vikas Patra 2064600 431000 484000 556000 560000
amount as per
balance sheet
6 Net Profit as per 6063878 5462100 18959831 9444670 8423015
Profit & Loss
Account
7 Interest on FDR 1494092 6069005 7975780 7944792 6825602
8 Interest on Kisan 268400 186400 53000 72000 -------
Vikas Patra
9 Interest on TDS 147720 154159 264843 ------ 299823
10 Income declared in ----- ----- 10500000 ------- --------
survey
11 Total interest 1910212 6409564 8293623 8016792 7125425
income not to be
included for
compensation or to
be deducted from
income shown in
ITR calculation
(7+8+9)
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
12 Total interest + 1910212 6409564 18793623 8016792 7125425 survey income not to be included as loss to the petitioners for compensation or to be deducted from total income shown in ITR income (10+11) 13 Business income of 4153666 (-)947464 166208 1427878 1297590 deceased (6-12) 14 Income as per Saral 4153666 5462600 15256378 9459670 7705170 Form/Business 15 Income from other 1912425 4031 3710476 4176 719023 sources 16 Gross Total Income 6066091 5466631 18966854 9463847 8424194 as per Saral Form (14+15) 17 Less deduction u/s 19487 11032 15088 15367 18399 80 18 Total Income/Saral 6046604 5455599 18951766 9448480 8405796 (16-17) 19 Agricultural Income 96000 96000 362000 380000 345000 20 Admitted 2100505 1641466 5954058 3101498 2812561 Tax/Surcharge/Ed ucation Cess etc. 21 TDS 4006378 2736716 6984579 6431837 2774811 22 Advance Tax ----- ----- 3300000 ----- ----- 23 Total 4006378 2736716 10284579 6431837 2774811 TDS/Advance Tax (21+22) 24 Refund (23-20) 1905873 1095250 4330521 3330339 (-)37750
Counsel for insurance company contended that the Income Tax Returns relied by the petitioner to compute the income of the deceased do not reflect the correct figures as the interest income on FDRs, Kisan Vikas Patra and interest on TDS for the relevant Assessment Years has not been correctly accounted for by the petitioners and according to him the net business income of the deceased after deduction of interest on FDRs/Kisan Vikas Patra/TDS as reflected in Serial No.13 of Annexure 1 above is to be taken for the relevant Assessment Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
Years. It was further submitted that the income for the Assessment Year 2001-02 is to be taken as Rs.4153666/- {(i.e. Rs.6063878/- (net profit as per Profit & Loss A/c as per S.No.6 of Annexure-1) minus Rs.1910212/- (interest income as per S.No.11 of Annexure-I)}. Further, income for the Assessment Year 2002-03 is to be taken in the negative as (-) 947464/- {(i.e. Rs.5462100/- (net profit as per Profit & Loss A/c as per S.No.6 of Annexure-1) minus Rs.6409564/- (interest income as per S.No.11 of Annexure-I)}. Further, income for the Assessment Year 2003-04 is to be taken as Rs.166208/- {(i.e. Rs.18959831/- (net profit as per Profit & Loss A/c as per S.No.6 of Annexure-
1) minus (Rs.8293623/- (interest income as per S.No.11 of Annexure-I) plus Rs.10500000 (income declared in survey as per S.No.10)}. Further, income for the Assessment Year 2004- 05 is to be taken as Rs.1427878/- {(i.e. Rs.9444670/- (net profit as per Profit & Loss A/c as per S.No.6 of Annexure-1) minus Rs.8016792/- (interest income as per S.No.11 of Annexure-I)}.
27. On the other hand, counsel for the petitioners contended that the income of the deceased is to be calculated as per the computation placed by him in his additional written submissions dated 05.09.2016 which is reproduced herein for proper appreciation.
Assessment Year 2001- 2002- 2003- 2004- 2005-
2002 2003 2004 2005 2006 (9
months)
Financial Year 2000- 2001- 2002- 2003- 2004-
2001 2002 2003 2004 2005
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Income from 4153666 5462600 15256378 9459670 7705170 business-It is not gross income Proportionate Tax 1370709 1640255 4789269 3100129 257502 including surcharge Business income 2782956 3822345 10467109 6359540 5132667 after Tax
28. I am of the considered opinion that the proceedings relating to MACT are required to be tried summarily to ascertain the correct income of deceased for purpose of compensation and the Income Tax Returns filed by the deceased cannot be scrutinized as sitting in appeal or in an audit. It cannot be ignored that the Income Tax Returns filed over a decade ago by the deceased during his lifetime stand accepted and in the absence of any contrary observations, the same have to be accepted as per record. The contention raised by counsel for insurance company that the interest on FDRs/Kisan Vikas Patra/TDS has not been properly accounted for, for the purpose of tax in the books of account or the documents as filed along with the returns cannot be investigated in this forum. The explanation given by the counsel for petitioners that the computation of interest on FDRs has been shown to be adjusted against the interest paid on the loans by the deceased for the purpose of assessment of income and, thereafter, the balance amount is reflected in the income from other sources appears to be plausible and in absence of any adverse orders on the Income Tax Returns filed by the deceased, the same has to be accepted. It may also be observed that it does not appear to Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. reason that the turnover of the firm in crores for the relevant Assessment Years as reflected by counsel for insurance company in Annexure 1 would be yielding the business income in the negative at (-)Rs.947464 for the Assessment Year 2002- 2003 and Rs.166208/- for the Assessment Year 2003-2004 even after having declared an income of Rs.10500000/- in the survey apart from other business income. The deduction of income of Rs.10500000/- as disclosed in the survey for the Assessment Year 2003-2004 made by the counsel for insurance company out of the net income of Rs.1895983/- as reflected in Annexure 1 of his written submissions is also fallacious as even the tax on the said amount for the relevant Assessment was paid by the deceased. It is not logical that the said undisclosed income be treated as relating to the previous years unless the same was so held by the Income Tax Authorities.
In the facts and circumstances and for the foregoing reasons, I do not agree with the contentions raised by counsel for insurance company for computing the income of the deceased for the relevant Assessment Years as referred at Serial No.13 of Annexure-1 of his written submissions.
The income of the deceased for the relevant Assessment Years 2001-2002, 2002-2003, 2003-2004, 2004- 2005 & 2005-2006 may be further tabulated below only for relevant heads as per Income Tax Returns and as reflected by counsel for insurance company in Annexure-1 and petitioners in their tabulation in para 27:
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
S.N Assessment Year 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006
o
1 Gross Total income 6066091 5466631 18966854 9463847 8424194
as per Saral Form (as
per S.No.16 of
Annexure-1 placed
by insurance
company para 26)
2 Income from 4153666 5462600 15256378 9459670 7705170
business (as per
S.No.14 of
Annexure-1 placed
by insurance
company para 26.
Also admitted by
petitioners)
3 Income from other 1912425 4031 3710476 4176 719023
sources (as per
S.No.15 of
Annexure-1 placed
by insurance
company para 26)
4 Admitted 2100505 1641466 5954058 3101498 2812561
tax/surcharge on
total income (as per
S.No.20 of
Annexure-1 placed
by insurance
company para 26)
5 Proportionate Tax 1370709 1640255 4789269 3100129 257502
including surcharge,
as calculated by
petitioners only on
business income at
S.No. 2 (As
calculated by
petitioners in their
tabulation in para
27).
6 Net Business income 2782956 3822345 10467109 6359540 5132667
after deduction of tax
for purpose of
assessment (i.e.
business income at
S.No.2 minus
proportionate tax at
S.No.5) (as
calculated by
petitioners in para
27)
Serial No.1 of the table reflects the gross income of the deceased.
Serial No.2 reflects the income from business as reflected for the relevant
Assessment Years.
Serial No.3 reflects the income from other sources apart from agricultural
income as per the Saral Forms.
Serial No.4 reflects the admitted tax paid on the total income along with
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
surcharge.
Serial No.5 reflects the proportionate tax on the income from business as calculated by counsel for petitioners.
Serial No.6 reflects the net business income after tax.
I am of the considered opinion that for purpose of computation of compensation, the income of the deceased needs to be considered by approximation as reflected at Serial No.6 in the table above for the Assessment Year 2001-2002 at Rs.2782956 (i.e Rs.4153666/- income from business - Rs.1370709 proportionate tax including surcharge); for the Assessment Year 2002-2003 at Rs.3822345/- (i.e. Rs.5462600 income from business - Rs.1640255 proportionate tax including surcharge); for the Assessment Year 2003-2004 at Rs.10467109/- (i.e. Rs.15256378/- income from business - Rs.4789269/- proportionate tax including surcharge); for the Assessment Year 2004-2005 at Rs.6359540/- (i.e. Rs.9459670/- income from business - Rs.3100129/- proportionate tax including surcharge) and for the Assessment Year 2005-2006 at Rs.5132667/- (i.e. Rs.7705170 income from business - Rs.257502/- proportionate tax including surcharge).
However, it may be observed that since the Income Tax Return for the Assessment Year 2005-2006 for the financial year 01.04.2004 to 30.12.2004 for a period of nine months has been filed after the death of the deceased by the LRs, the same may be excluded as the exaggeration in income cannot be ruled out and as settled in several cases. Further, the Income Tax Return for the Assessment Year 2002-2003 needs to be excluded as the same has not been Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. proved by the witness from Income Tax Department. In the facts and circumstances, for the purpose of assessment of compensation, the income of the deceased is taken as average of the income for the Assessment Years 2001-2002, 2003-2004 and 2004-2005 at Rs.65,36,535/- per annum.
29. Income of the New Entity M/s Tomar Construction Company (A Partnership concern) Counsel for insurance company placed reliance upon the tabulations as placed in Annexure-2, 3 & 4 of his written submissions for depicting the income of M/s Tomar Construction Company (A Partnership Concern) formed by the petitioners after the death of the deceased and individual returns filed by the petitioners and the same may be reproduced for proper appreciation of contentions.
Annexure-2 ITR Details of Tomar Construction Company Partnership Firm S. Assessment Year 2005-2006 2006-2007 2007-2008 2008-2009 No. 1 Financial Year 31-12-2004 to 01-04-2005 to 01-04-2006 to 01-04-2007 to 31-03-2005 31-03-2006 31-03-2007 31-03-2008 2 Income Tax Returns Return filed by Return filed by Return filed by Return filed by filed on and by Sandeep Mr. Sandeep Mr. Sandeep Mr. Sandeep Tomar as Tomar as Tomar as Tomar on 31-
partner on 03- partner partner Oct-2007
Oct-2005
3 Turnover 50347453 231792972 197665907 328778565
4 FDR amount 106583885 106163291 110301741 Details not
mentioned in Balance available in ITR
Sheet 5
5 Kisan Vikas Patra 600000 600000 600000 Details not
amount as per Balance available in ITR
Sheet 5
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
6 Net Profit as per Profit 2631481 13456607 12457000 18885044
& Loss Account (11+12)
7 Interest on FDR 2381698 1344393 7592310 Details not
available in ITR
5
8 Interest on Kisan Vikas 44000 ----- ----- Details not
Patra available in ITR
9 Interest on TDS/SD ----- 199818 45811 Details not
available in ITR
5
10
11 Yearly firm net profit 1315741 6728304 6228500 9442522
share transfer to
Sandeep Tomar
account
12 Yearly firm net profit 1315740 6728303 6228500 9442522
share transfer to Sumit
Tomar account
13 Income as per Saral 2631482 13456607 12478483 18890394
Gross Total Income
14 Admitted 1013121 4529494 4200257 6420845
Tax/Surcharge
Education Cess etc.
15 TDS 2774811 6257817 4954083 8106490
16 Refund (15-14) 1761690 1728323 753826 1685645
Annexure 3
Details of Personal Returns - Sandeep Tomar S. Assessment Year 2005-2006 2006-2007 2007-2008 2008-2009 No. 1 Financial Year 01-04-2004 to 01-04-2005 to 01-04-2006 to 01-04-2007 to 31-03-2005 31-03-2006 31-03-2007 31-03-2008 2 Business Income as 97800 90000 127700 114495 per Saral Form (ITR) 3 Income from other -- 31370 54883 8504 sources 4 Share/profit of Mr. 1315741 6728304 6228500 9442522 Sandeep from M/s Tomar Construction Company exempt u/s 10(2A) of I. Tax Act 5 Total Income of Mr. 1413541 6849674 6411083 9565521 Sandeep Tomar 6 Agricultural Income ---- 115000 122700 150300 7 Deduction for I. Tax ---- ---- 56630 10000 8 Rebate/TDS/Self 8560 4574 5313 963 Assessment/Advance Tax Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.
Annexure 4 Details of Personal Returns - Sumit Tomar S. Assessment Year 2005-2006 2006-2007 2007-2008 2008-2009 No. 1 Financial Year 01-04-2004 to 01-04-2005 to 01-04-2006 to 01-04-2007 to 31-03-2005 31-03-2006 31-03-2007 31-03-2008 2 Business Income as 98800 95000 105000 160010 per Saral Form (ITR) 3 Income from other 10 8725 6205 7073 sources 4 Share/profit of Mr. 1315741 6728304 6228500 9442522 Sumit from M/s Tomar Construction Company exempt u/s 10(2A) of I. Tax Act 5 Total Income of Mr. 1414551 6832029 6339705 9609605 Sumit Tomar (2+3+4) 6 Agricultural Income ---- 115000 122700 130200 7 Deduction for Tax ---- ---- 6630 50000 purpose 8 Rebate/TDS/Self 8760 794 970 1514 Assessment/Advance Tax Counsel for insurance company vehemently contended that there was no loss of dependency since the business carried by the deceased was continued by the petitioners. It was urged that the income continued to be generated from the same business earlier carried in the name of deceased as Tomar Construction Company and subsequently changed to a partnership concern in the name of the petitioners. It was pointed out that the net income after deduction of TDS from the gross income as per Annexure-2 was to the tune of Rs.1618361/- (i.e. Rs.2631482 gross income - Rs.1013121 tax) for Assessment Year 2005-2006 (period 31.12.2004 to 31.03.2005); Rs.8927113/- (i.e. Rs.13456607 gross total -
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. 4529494 tax) for the Assessment Year 2006-2007; Rs.8278226/- (i.e. Rs.12478483/- gross income - Rs.4200257 tax) for Assessment Year 2007-2008 and Rs.12469549/- (i.e. Rs.18890394/- gross income - Rs.6420845/- tax) for Assessment Year 2008-2009. Reliance was further placed upon the Income Tax Returns filed on behalf of the petitioners in respect of the partnership firm "M/s Tomar Construction Company" as well as individual returns in the name of Sandeep Tomar & Sumit Tomar.
30. It may be observed that the Income Tax Returns filed on behalf of Tomar Construction Company (A Partnership Firm) formed by the petitioners after the death of the deceased and the income as reflected in the Income Tax Returns have not been controverted by counsel for petitioners. The same reflects generation of income from construction business after the death of the deceased. However, it needs to be assessed if there was any loss of income and if the petitioners are entitled to compensation.
It may be noticed that M/s Tomar Construction Company (A Proprietorship Concern) run by the deceased was duly enlisted with CPWD for some time prior to his death cannot be disputed. The mere fact that the same had not been renewed during his lifetime for a period of few months prior to the accident on 30.12.2004 does not make out a case that the enlistment with the CPWD was not necessary for purpose of execution of government contracts as contended by counsel for Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. insurance company. Judicial notice can be taken of the fact that for execution of several government contracts the minimum experience and turnover remain prerequisite conditions of participation of tenders for the contracts. The same is also corroborated by testimony of PW11 Virender Kumar, Executive Engineer, CPWD. He categorically deposed that in case a proprietorship firm, if the proprietor registered for contracts with CPWD expires, the firms ineligible for future participation and the experience and turnover of the said firm cannot be carried forward for purpose of further registration/renewal of firm. He further stated that fresh partnership which does not have requisite experience as per eligibility criteria may not be eligible for registration of firm with CPWD. Further the pre- registration with CPWD is necessary for award of contracts by certain institutions. The testimony to the aforesaid extent cannot be disbelieved as contented by the counsel for insurance company that the enlistment rules pertained to years 2005-08 and not for the period 2001-04.
31. In the aforesaid context, it may also be noticed that on the relevant date of accident i.e. 30.12.2004 admittedly petitioner no.2 was aged only 18 years while petitioner no.1 was aged about 21 years and was forced to settle back in India instead of continuing further education/temporary job at Australia. It is implicit that at the tender age of 18 and 21 years the petitioners hardly had any business experience to continue the business of contractorship carried by the deceased which Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. requires experience, expertise and contacts to carry on the projects. There is absolutely no evidence on record to show that petitioners had any experience in this regard and the testimony of PW6 Sandeep Tomar that they were forced to continue with some of the projects to avoid forfeiting of security deposits cannot be disbelieved.
It is also pertinent to note that had the claim petition preferred on 01.03.2005 by the petitioners been decided within a reasonable period of about one year, the question for consideration of future income of the new entity namely Tomar Construction Company (A Partnership Concern) formed by the petitioners may have been relevant only for the period 31.12.2004 to 31.03.2005 for consideration since the earlier proprietorship firm in the name of deceased i.e. Tomar Construction Company admittedly stood dissolved on the death of the deceased on 30.12.2004. The returns for the subsequent period may not have been even under consideration. It cannot be ignored that the new firm was formed by the petitioners to avoid penalties and losses in the contracts which could be carried forward and avoid forfeiture of security amount in respect of the contracts undertaken by deceased. Testimony of PW6 Sandeep Tomar is categorical that the new entity Tomar Construction Company (A Partnership Firm) did not have the requisite turnover and experience to take up the government projects and further some of the old projects were continued to avoid the penalties and forfeiture of security deposit. Further, some of the contracts undertaken by the earlier firm run by the Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. deceased Satyabir Singh Tomar are also stated to have been cancelled.
32. It may be observed that even if the subsequent earnings of the petitioners are partly based upon the infrastructure and capital owned by predecessor firm along with some of the continued contracts and business income continued to some extent, it cannot be ignored that the execution of the contracts involve the individual efforts and provision of services by the petitioners. It cannot be assumed that there was no loss of income on account of death of deceased who carried a lifetime experience and managerial skills.
The list of exact contracts which were continued by the new partnership firm along with the corresponding income cannot be quantified in absence of concrete evidence but only an inference as to the same has to be drawn from the available record and the Income Tax Returns. It may further be noticed that the new entity Tomar Construction Company (A Partnership Firm) is also claimed to have entered into fresh contracts as an independent entity though undoubtedly infrastructure/capital of the earlier firm run by the deceased Satyabir Singh Tomar was available for executing the contracts. I am of the considered opinion that the mere reflection of certain liabilities and assets along with some payments received for the work executed by the deceased does not lead to an inference that there was no loss of income by death of deceased Satyabir Singh Tomar. The earlier firm having been dissolved and the new firm in the Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. absence of pre-requisite experience/qualifications was not competent to continue to some of the contracts. Moreover, the claimants in the new partnership had to give their own labour, skill and devotion for carrying on the projects which were entered by the new entity.
33. It is important to note that actual pecuniary loss can be ascertained only by balancing on one hand for the loss to the petitioners of future pecuniary benefits and on the other hand any pecuniary advantage which from whatsoever source comes to the petitioners by reason of death (i.e. the loss and gain to the dependents by death) has to be ascertained. The object remains to save the dependents from being deprived of the source of their maintenance and as far as possible to provide them with the means as were available to them in pre-accident period.
The earnings of the deceased Satyabir Singh Tomar would have added to the estate irrespective of the individual settlement of the petitioners and would have ultimately devolved on the petitioners. The deceased was aged about 47 years and would have successfully run the business for a period of about 15-20 years. The individual earning of the petitioners with their own efforts, skills and expertise with whatsoever contracts were left over after the death of the deceased, cannot be clubbed with the loss of earnings which has been resulted due to the death of deceased.
I am of the considered opinion that while the income Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. from the interest and agricultural income may remain unaffected by the death of the deceased but the income generated due to the business on account of personal supervisory skills and experience as a Class-I contractor were definitely affected even if the petitioners were able to continue and generate income on the basis of available infrastructure and some preexisting contracts which were executed by them. Therefore, it would be prudent to compute the loss of income to the extent of being mitigated by 30% due to the personal supervisory and managerial skills of the deceased. The annual income on the basis of the average of the Income Tax Returns filed by the deceased in the name of Tomar Construction Company has already been computed at Rs.65,36,535/- per annum. A comparison of the income filed by the deceased for the Income Tax Returns also irrefutably reflects that there was progressive rise in the earnings. As per Sarla Verma (Smt.) & Others vs. Delhi Transport Corporation & Another (2009) 6 SCC 121, in view of the age of deceased as 47 years at the time of accident, the future prospects of increase in earnings need to be factored by 30%. Thus, the income of the deceased for the purpose of computation is assessed at Rs.84,97,496/- per annum {i.e. Rs.65,36,535/- (average income per annum) + Rs.19,60,961/- (30% addition towards future prospects)}. However, the loss of income to the extent of being mitigated is computed to 30% due to the personal supervisory and managerial skills of the deceased which comes to Rs.25,49,249/- per annum (i.e. 30% of Rs.84,97,496/-. Further, the deduction towards personal and Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. living expenses of the deceased is taken as 1/3rd .
It may also be observed that ordinarily the provisions of Sch. II including the multiplier may be taken as a guide and only in exceptional cases having special features or facts call for deviation from the scheduled multiplier on special reasons. Since the compensation has been computed only assessing for the loss of supervisory/managerial skills which would have lasted for the lifetime of the deceased, the multiplier cannot be curtailed/restricted to 05 taking the dependency of petitioners only for a period of five years as contended by the counsel for insurance company. For the aforesaid reasons, the applicable multiplier in the present case is taken as 13 as per Sarla Verma (Smt.) & Others vs. Delhi Transport Corporation & Another (2009) 6 SCC 121 in view of the fact that deceased was aged 47 years at the time of accident.
The loss of dependency is accordingly computed at Rs.2,20,93,491/- {Rs.25,49,249/- (30% of the annual income of the deceased as calculated above) x 2/3 (dependency) x 13 (multiplier)}.
34. Compensation under non-pecuniary heads:
The petitioners have been awarded a sum of Rs.50,000/- towards loss of love and affection and Rs.7,000/- towards the funeral expenses in MAC APP 53/2010 Sandeep Tomar & Anr. vs. Oriental Insurance Company Ltd. in respect to the compensation awarded for the death of their mother Smt. Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Reeta Tomar in the same accident. The claimants have been further awarded interest @ 7.5% per annum from the date of filing of claim petition till the date of deposit.
Accordingly, petitioners are entitled to Rs.50,000/- towards loss of love and affection, Rs.10,000/- towards loss of estate and Rs.10,000/- towards funeral expenses considering the fact that the accident took place on 30.12.2004.
35. The petitioners/claimants are accordingly entitled to compensation computed as under:
Loss of financial dependency Rs.2,20,93,491/-
Loss of love and affection Rs.50,000/-
Medical Treatment Rs.NIL
Loss of Estate Rs.10,000/-
Funeral Expenses Rs.10,000/-
________________
Total Rs.2,21,63,491/-
------------------------
(Rupees Two Crore Twenty One Lakh Sixty Three Thousand Four Hundred & Ninety One Only) The claimants/petitioners are also entitled to interest @ 7.5% p.a. from the date of filing of petition w.e.f. 06.05.2005 till realization.
The amount of interim award, if any, shall however be deducted from the above amount, if the same has already been paid to the petitioners.
The amount already deposited by the insurance company shall be accordingly reconciled and adjusted.
36. It is further held that Respondent No.1 (Driver), Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. Respondent No.2 (Owner) and Respondent No.3 (Insurer) of the offending vehicle are jointly and severally liable to make the payment of compensation to the petitioners/claimants.
37. For the purpose of disbursement, petitioner no. 1 Sandeep Tomar and petitioner no. 2 Sumit Tomar shall be entitled to 50% each of the award amount and interest thereon.
On realization, an amount of Rs.10 lakh each shall be released to petitioner no. 1 & 2 and remaining amount of their respective shares shall be kept in ten fixed deposits of equal amount in their names for a period of one year, two years, three years, four years, five years, six years, seven years, eight years, nine years and ten years respectively without the facility of advance, loan or premature withdrawal with release of quarterly periodical interest in their respective accounts.
38. Relief Since the offending vehicle was duly insured, Respondent No.3/Oriental Insurance Company Ltd. is directed to deposit the award amount of Rs.2,21,63,491/- with interest @ 7.5% per annum from the date of filing of claim petition i.e. 06.05.2005 till realization with Nazir of this Court within 30 days under intimation to the petitioner, failing which the Insurance Company shall be liable to pay interest @ 12% per annum for the period of delay beyond 30 Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors. days.
Insurance Company/driver and owner of the offending vehicle are also directed to place on record the proof of deposit of the award amount, proof of delivery of notice in respect of deposit of the amount with the Tribunal to the claimant and complete details in respect of calculations of interest etc. in the court within 30 days from today.
A copy of this judgment be sent to Respondent No.3/ Oriental Insurance Company Ltd. for compliance within the time granted.
Nazir is directed to place a report on record in the event of non-receipt/deposit of the compensation amount within the time granted.
File be consigned to Record Room.
Announced in open court (Anoop Kumar Mendiratta) on 15th September, 2016 Judge MACT-1 (Central)/ Addl. Distt. & Sessions Judge Tis Hazari Courts, Delhi.
Suit No.260/12 - Sandeep Tomar & Anr. vs. Ashok Kumar & Ors.